Question

James and Laura Financial planning case study is intended to introduce students to the basic concepts of estate planning, wills and power of attorney.

You are required to guide James and Laura in:

a) preparing a will. Please include what factors should be taken into consideration. Their strength and weaknesses.

b) deciding whether Power of Attorney is necessary. If yes, what are the factors that they have to consider.

Answer 1

A) factors which are necessary in consideration of preparing a will are as follows-

I. Will can vary in their effectiveness and their type.

II will is important in order to heirs having a faster and easier time getting access to the assets.

III. I will will help the assets to be kept out of hands of those people who you don't want to be sharing with and you can decide one can get how much.

IV. It can also help to save the estate money on the taxes and you can also give gifts and charitable donations.

The benefits of a will is that it avoid probate process and you get to decide who will wind up the affairs of your state and whom you want to distribute.

weaknesses of the wills is that it may be subject to probate and possible changes regarding validity and it becomes public record which anyone can access.

B)power of attorney is necessary for those persons who wants to permit another person to perform certain legal act on his or her behalf and they will be needing a power of attorney.

power of attorney document can allow other person to handle financial matter, make health related decision, and care for your children so it is an important document.

Factors you need to consider is that, the other person is of sound mind and he is trustworthy and it will mean that the document stays in effect if you become incapacitated, and unable to handle matters on your own.